Chairman Of Samsung Electronics, Jay Y. Lee, Declared Not Guilty Of Allegations Of Money Laundering And Share Manipulation "

Chairman of Samsung Electronics, Jay Y. Lee, (photo: dock. samsung)

JAKJARTA - On Monday, February 5, the Seoul Court declared the Chairman of Samsung Electronics, Jay Y. Lee, innocent in the case of money laundering and stock manipulation related to the merger in 2015. The merger, according to prosecutors, was designed to strengthen Lee's control of the tech giant.

The decision surprised some analysts who expect a suspension verdict, and could give Lee more freedom in managing South Korea's biggest conglomerate.

"For entrepreneurs and business leaders, their job is to encourage innovation and create jobs, but Samsung hasn't been able to do it for nine years because of legal risks," said Korea's Catholic University business professor Kim Ki-chan. Lee's legal issues make Samsung Electronics bureaucratic and risk-safe.

Lee, 55, along with other former executives, is accused of organizing a merger between two Samsung affiliates - Samsung C&T and Cheil Industries - which are considered detrimental to the interests of minority shareholders. Prior to the merger, Lee's family and related entities controlled Cheil but not Samsung C&T, which was the main shareholder in Samsung Electronics.

Although prosecutors demanded a five-year prison sentence, a panel of three judges at the Seoul Central District Court stated that the merger decision was taken by the two-companies' council following their considerations and reviews.

"It cannot be concluded that the main goal is to strengthen Lee Jae-yong's management rights and facilitate succession within the Samsung Group," said Judge Park Jeong-je.

All 14 defendants, including Lee, were found not guilty. This decision prevented Lee from being imprisoned again after previously being sentenced to 2017 for bribery to a friend of former South Korean President Park Geun-hye.

If the prosecutor decides not to file an appeal, this will end Lee's legal problems since 2016. Samsung C&T's shares, the de facto holding company where Lee became the largest shareholder, had risen to 5%.